Replies to post #146189 on Value Microcaps Motherboard

[researcher59]

re Airlines, the biggest US carriers, UAL, DAL and LCC, have sharply negative tangible book values .... on the other hand, there are plenty of small carriers like RJET and SKYW that have much stronger balance sheets than HA.

Basically I agree, HA becomes a better buy at lower prices, which is why I took only a very small starter position.

Note also that while their growth initiatives are good news, there's no guarantee it will add to the bottom line .... revenues will grow but so will expenses. Who knows how profitable, if at all, the new routes will be ???

[cliffvb]

HA, nelson, on lower depreciation expense- HA leases 13 out of 37 of its planes including about half of its larger fleet and so depreciation for leased planes should be factored into aircraft rent. They do own 14 out of 15 of the smaller planes that are used for inter-island travel, but these are also older planes (10.5 yrs old on average) so I would also expect depreciation expense for those to be less for those than with newer planes. Capex is high because they are expanding their fleet.

I expect that Hawaii will be a popular vacation destination this year with all the ongoing financial problems in Europe. I personally know of two people who had their wallet and purse stolen from them while they were sightseeing over there. Lots of unemployed and desperate people in Europe- much less risk of vacation ruining problems like that in Hawaii.

I've also been adding HA as it drops lower. Worth noting that HA does hedge for fuel costs. They have roughly twice as many gallons hedged as they typically use in a quarter. With the big drop in fuel prices in Q2, they will have show some good size hedging losses but that is a non-operational loss that looks like it will go back to a nice gain in Q3. I don't think it will hurt the stock price. We'll see.